Why Facebook may never be able to fix online speech ?
The way Facebook's ad model and the ecosystem around it has evolved over time; it has become almost impossible for the company to take a different approach to online speech without hurting revenue.
Facebook’s revenue in the first quarter of 2020 stands at around $17.7 billion. Almost all of it (98%) comes from advertising. Facebook ad model is about passive display of advertisements to users as they are engaging with the platform [1]. It could be that they are browsing pictures, chatting with friends, reading news etc. Increasing revenue for the company thus directly depends a lot on increasing the engagement on the platform. A key part of engagement on Facebook is consuming content or online speech on the platform which includes shared content from news publishers as well as follow up opinions and reactions from individuals. This overarching focus on growing engagement is what I believe makes Facebook helpless at implementing a strategy which is good for the society as a whole when it comes to news & online speech. On the contrary it may be motivated (or maybe it’s algorithms are , who to blame?) at influencing our thinking to the best possible revenue model. As shown in the image above, the source of media engagement on Facebook has evolved into a complicated relationship between users, the News Feed, and the publishers. I explain each component and the relationship in detail below.
Users
The potential audience for Facebook was around 1.95 billion in 2017. Monthly active users for the company stands at 2.6 billion as of 2020. It’s running out of new users which means increasing engagement is the only way of growing revenue. I did some back of the envelope calculation [2] which shows that the company makes around $2 - $2.5 on average per user per month for which it would have to show around 1500 ads per month or 50 ads per day to a single user. But since each user is different, what ends up happening is that some users end up seeing lot of ads while others not much. But keeping aside that fact, to show ads on a per user basis, it needs to keep those users on the platform. A major part of Facebook usage is catching news and Facebook is the biggest driver of traffic to publishers when it comes to social media. This goes to show how media is an integral part of keeping up with the engagement at the company and one of the primary ways to do that is News Feed.
Facebook News Feed
The News Feed itself is a black box and not much is known about the amount of emphasis it gives to different parameters. Explained in this article -
The Facebook algorithm controls the ordering and presentation of posts, so users see what is most relevant to them. Rather than publish content chronologically, posts and ads are presented based on what Facebook sees as relevant to you, the user.
When it comes to relevance; it takes into account what is getting popular measured through likes and comments, plus the pages that a user follow. But again, what’s getting more priority is not publicly available. To keep up with the engagement to support the ad revenue, the News Feed has very strong reasons to give us content [3] that is focused on three default user instincts or what I call the 3 E’s of human behavior [4].
Effortlessness
The amount of news we are getting today is mind boggling and there is never a moment when we open our phone and we can’t find a new article, video or image to check out. With phones, this has aggravated and has given rise to things like mindless scrolling. People are checking their phone more often because it’s too easy and their Facebook or Twitter News Feed gives that rush of dopamine. The Facebook News Feed itself cannot be blamed for this. But since the content is mixed up from friends, relatives, people you follow, publishers etc; the competition for user attention naturally leads to a dynamic where getting attention to your business or to your opinion, is a lot about posting more content.
Emotion
Media that targets our emotional side is bound to get more attention than the one which just lays down the bare facts. From a recent study of 100 million headlines, some top performing phrases were “Make you cry”, “Gives you goosebumps”, “Is too cute”, “Shocked to see”. Goes without saying that content which arises an emotion; shocks you for example, will get more eyeballs. Another example is negative news. Our emotions also drive us towards it. Discussed in this article -
When we identify something negative, we're drawn to it. We are compelled to unwind the mystery and gather knowledge about negative things. In the world of online reputation management, this means that we tend to click on things that are negative. This drives traffic, causing the negative to rise in search results.
Facebook of course doesn’t influence what’s getting posted on the platform when it comes to the emotional side of the content. The algorithms would just bubble up a particular post if a lot of people start reacting to it. A big part of measuring reaction by the algorithm is how many people have liked or left their comments on it. Sensationalized posts and catchy headlines are the best candidates here. People might not even read the article or take the time to think and leave a comment. Even if someone leaves a detailed comment; the sentiment of their opinion is not captured when deciding the popularity of the article.
Easy on the mind
Cognitive dissonance exists and the default behavior of the mind is to avoid it. If we are able to get content which is more easy to read and already fits a pattern in the mind, it’s easy for us to stay engaged. By design, News Feed focuses on content that you like or your friends like. This focus, although does help when it comes to filtering out fake news, it creates another problem as well. It reinforces existing views than challenge them. As explained in this article -
The platform thinks it's up to you to make friends with people who don't think like you, so that your News Feed will reflect a range of views. (You could look for news beyond Facebook, too.)
From a business perspective, Facebook's approach makes a lot of sense. And Facebook is obviously entitled to make its platform a low-stress escape.
Filter bubble has real impact as argued by this study in NY Times about how filter bubbles led to anti refugee attacks in Germany. Or how ISIS was able to win the social media war and become a major threat even though they had a small army and limited resources.
Facebook has continuously tweaked the News Feed algorithm and on multiple occasions tried to make it more relevant for the user. In 2018, M. Zuckerburg announced changes to make the News Feed centered around your friends and family members. This should have ideally dropped the media traffic coming from Facebook in the two years since. But it has only increased from around 10% at the start of 2018 to 13.5% presently. Also, as reported in this article, one year after the announcement to make feed more personal, Fox News which has been repeatedly accused of spreading information; dominated the news and has seen the highest engagement on Facebook. Even though publishers like Fox news may have hidden agenda or motive to spread propaganda news; the fact of the matter is that there has been lot of impact on other news publishers in terms of the way they make money which has pushed them to follow the way News Feed works religiously.
The publishers
The publishers have received a two way blow with the advent of internet. First, it’s now possible for a user to get news and other forms of content from anywhere for free. Second publishers earlier had leverage with advertisers in terms of displaying targeted ads to a particular type of users. This got shifted in a big way to companies like Facebook and Google. As explained nicely in this article -
In pure efficiency terms, most of this is great. As an advertiser I don’t have to pay high rates to reach New York Times readers on The New York Times. I can pay Google or Facebook to find them for me elsewhere for much cheaper prices.
Specifically, Facebook is able to target a user in much better way because it’s a social network and it knows about us, our friends, relatives, likes and dislikes. For advertisers it’s a great deal because they get to target users in a much better way and at a cheaper cost. This has resulted in publishers searching for new ways to make money. Analysed here in the Stratechery article -
First and foremost that means publishers need to answer the most fundamental question required of any enterprise: are they a niche or scale business? Niche businesses make money by maximizing revenue per user on a (relatively) small user base. Scale businesses make money by maximizing the number of users they reach.
Publishers moving to a subscription based model means that, a majority of users who are not subscribers would not be able to read the full article and thus would reduce the chances of the content not becoming popular enough (on media platforms and elsewhere). This in turn means that if a content is truly thought provoking; it might just get unnoticed and remain within the circle of the subscribers. Advertisers opting for the second model would have to compete for attention on News Feed which means catering to the three E’s of human behavior. A statement from this article elaborates on it.
The News Feed Editor has literally changed the way news is written. It has become the number one driver of traffic to news sites globally, and that has shifted the behavior of content creators. To get a story picked up by the News Feed Editor, news producers (and human editors) have changed their strategies to stay relevant and stem losses. To do this, many news organizations have adopted a traffic-at-all-costs mentality, pushing for more engagement at the expense of what we would traditionally call editorial accuracy.
Generating eye balls and writing catchy headlines to sell the story is one aspect of it. The extreme side is the negative and fake news content that is spread by many organizations to spread their message or just to receive enough traffic. Although Facebook is taking hard stance on it, it’s still unclear the amount of emphasis and motivation Facebook has in controlling it. In 2016 US presidential campaign; the fake election news story generated more total engagement on Facebook than top election stories from 19 major news outlets combined (source). Plus, news with bias or a hidden agenda which shocks people or makes them feel fearful (and thus leads to more eyeballs) is something that Facebook clearly has no action plan for [5].
The interplay between the Facebook’s ad model, its News Feed, the publishers and the users has become so intricate and a money making machine for the company; that it may have made it biased towards it’s own approach. As pointed out rightly by Ben Thompson in a Stratechery article -
“Unlike fake news or Russian agents, which involve a bad actor the company can investigate and ban, the propagators of filter bubbles are users ourselves. To fix the problem is to eliminate the temporary emotional comfort that keeps users coming to Facebook multiple times a day, and that is if the problem can be fixed at all. Indeed, perhaps the most terrifying implication of this study is that, if true, the problem is endemic to social networks, which means to eliminate the former necessitates the elimination of the latter.”
The above statement suggests that the biggest problem with Facebook is the users them self and probably the fundamental question - is giving users what they want the end to all means ? This article about TikTok, which kind of works on the same principal of giving users what they want, makes an excellent point -
The algorithm gives us whatever pleases us, and we, in turn, give the algorithm whatever pleases it. As the circle tightens, we become less and less able to separate algorithmic interests from our own.
This statement of course talks about TikTok specifically but the same logic can be applied to Facebook as well. If we assume the company’s position to be neutral as true, does that mean that it’s the algorithms and not the humans at Facebook, that are influencing the society on the whole ? Whatever the case maybe; the current machine is working very well for Facebook and there’s no reason it seems that they won’t continue to keep it running it as long as possible. Or at least until they are able to generate significant revenue from a different product.
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[1] This model is how any social media platform like Twitter, Instagram, Snapchat work. It’s different from a company like Google, which is more intent based; showing ads based on the keywords searched by users where most of it’s revenue comes from.
[2] As per the quarterly revenue of $17.3 billion from ads, Facebook makes around $6-7 or $2-2.5 per user per month on average . The average cost of clicking an ad on Facebook is $1.5 and if we assume that a user clicks on an ad .1% of the time ( assuming average CTR); a user would have to see around 1500 ads in a month or around 50 ads on a daily basis.
[3] Note that other platforms like Twitter, Snapchat or Instagram do target user’s default instincts too. But Facebook by far has the most because of the sheer number of users it has on it’s platform plus the high percentage of population that depends on Facebook for news.
[4] The 3 E’s exists in various other forms. Effortless - Is Technology Making us Lazy ?. Emotion - Art of Emotional Design. Easy on the mind - Cognitive Dissonance Theory. I mention them here in context of the content we consume in our daily life.
[5] When I say Facebook has no action plan for it; I specifically refer to the inaction by the company in terms of removing posts with inaccurate or inflammatory content. Facebook has setup an independent oversight board with the goal of “exercising independent judgment over some of the most difficult and significant content decisions”. But the committee hasn’t come up with any action plan yet.